The auditor of Bangladesh Industrial Finance Company (BIFC) has warned of significant financial risks as key indicators have remained negative for over a decade.

The scam-hit non-bank financial institution (NBFI) posted a cumulative loss of Tk 13.58 billion as of December 2023, with total liabilities exceeding assets by Tk 12.02 billion. The auditor’s report, published Monday, highlighted a negative operating cash flow of Tk 78.96 million at the end of 2023, indicating a severe cash crunch.

BIFC incurred a loss of Tk 263 million in the nine months through September 2023. By the end of 2023, more than 90% of its loans had turned non-performing, and the institution failed to maintain the required provisions due to the high volume of classified loans. The company’s cash reserve ratio (CRR) deficit stood at Tk 27.66 million, while its statutory liquidity reserve (SLR) deficit amounted to Tk 250.44 million.

Due to missing documentation, the auditor could not verify deposits worth Tk 1.86 million out of Tk 35.85 million kept with the Bangladesh Bank. BIFC also failed to transfer unclaimed dividends worth Tk 4.34 million to the Capital Market Stabilization Fund on time, violating regulations.

BIFC has been in the red since 2015 and has not paid dividends since 2014. On Monday, the company’s stock fell 2.46% to Tk 7.90 per share on the Dhaka Stock Exchange. The auditor was unable to verify property values due to missing records.

BIFC was one of four NBFIs affected by loan scams involving Proshanta Kumar Halder (PK Halder) and associates. Former BIFC chairman Abdul Mannan, a former state minister, is also implicated in financial irregularities that worsened the institution’s condition. The Anti-Corruption Commission’s case statement indicates that Mannan’s business group embezzled around Tk 10 billion.

Additionally, a 2016 Bangladesh Bank investigation found that PK Halder siphoned off Tk 5 billion through fraudulent loans.